The applicants, Mr Afram Barsom and Mr Levent
Varli, are Swedish nationals, who were born in 1962 and 1974 respectively
and live in Södertälje. They were represented before the Court by
Mr R. Armholt, a lawyer practising in Stockholm.

A. The circumstances of the case

The facts of the case, as submitted by the applicants,
may be summarised as follows.

Mr Barsom owns 31.25% and Mr Varli owns 43.75%
of the active shares of a limited company, Restaurang Välfunnet Holding AB, which in turn owns a restaurant, Restaurang Välfunnet.
Both applicants are involved in the daily running of the restaurant
which is open for lunch, dinner and, during weekends, a discotheque.

During 2004 the Tax Authority (Skatteverket) in Stockholm carried out a tax audit of the restaurant
covering the period from June 2001 to July 2002. It found that the bookkeeping
of the restaurant was severely deficient and that it had not kept the
necessary evidence of the business’s expenses and sales. Based on
certain calculations and statistics, the Tax Authority estimated that
the restaurant had omitted to account for and declare all its sales
in its bookkeeping and tax returns. Consequently, it found it necessary
to make a discretionary assessment of the restaurant’s unrecorded
sales, which it calculated at SEK 2,700,000 (approximately EUR 292,300)
and to adjust its tax returns accordingly.

On 8 December 2004, on the basis of the results
from the tax audit, the Tax Authority decided to increase the applicants’
income from business for the tax assessment years 2002 and 2003 and
to impose tax surcharges on them amounting, in total, for Mr Barsom
to SEK 106,084 (approximately EUR 11,460) and for Mr Varli to SEK 144,512
(approximately EUR 15,610). As the applicants, together with a third
person, were the main owners of the company which owned the restaurant,
and as they were in charge of its daily running, the Tax Authority found
that most of the unrecorded sales from the restaurant were to be considered
as taxable income, in the form of salary, for the applicants and the
third person. Moreover, since the applicants had failed to provide correct
and complete information concerning their income, the Tax Authority
considered it justified to impose tax surcharges on them and found no
grounds on which to remit the surcharges.

In January 2005 the applicants and the company
appealed against the decisions to the County Administrative Court (länsrätten)
of the County of Stockholm, disputing the Tax Authority’s findings
and claiming that there were no grounds for changing their tax returns
or imposing tax surcharges on them. In both their appeals and their
supplementary submissions, the applicants stated that they wished to
rely on the same grounds as the company had in its appeal and supplementary
submissions to the court. The applicants and the company were represented
by the same lawyer.

On 14 March 2005 the Tax Authority made the obligatory
reassessment of its decisions of 8 December 2004 but decided not to
change them. Following this, it forwarded the appeals to the County
Administrative Court.

On 31 August 2005 the applicants requested the
County Administrative Court to grant them legal aid to engage a lawyer
to represent them. They referred to Article 6 § 3(c) of the Convention,
claiming that since their cases concerned tax surcharges they had a
right to free legal aid. The applicants stated that they lacked the
means to pay for a lawyer since they had been obliged to pay the additional
taxes and tax surcharges, as they had not been granted respite from
the payment. Furthermore, they alleged that, as immigrants in Sweden,
they did not have a complete command of Swedish or knowledge of the
Swedish legal system and that their cases were complicated and involved
significant amounts of money for them.

On 8 September 2005 the County Administrative
Court rejected the applicants’ request. It first noted that, according
to the Legal Aid Act (Rättshjälpslagen, 1996:1619), the possibilities for a businessman
to be granted legal aid in tax matters were very limited and it could
only be granted if there were special reasons. It further observed that
Article 6 § 3(c) of the Convention laid down that a person was entitled
to free legal assistance only if he could not afford it himself and
the interests of justice so required. It also noted that the domestic
case-law indicated that there was no absolute right to legal aid in
cases involving tax surcharges but that regard must be had to the amount
at stake (the tax surcharges) and the complexity and nature of the case.
Turning to the particular circumstances of the applicants’ cases,
the court considered that the material invoked by the parties was relatively
voluminous but that the legal questions at issue and, in relation to
these, the ancillary questions concerning tax surcharges were not of
such a character as to warrant a grant of legal aid, under either
Swedish law or the Convention.

The applicants appealed against the decisions
to the Administrative Court of Appeal (kammarrätten) in Stockholm, repeating their claims and adding
that, having regard to their financial situation, the tax surcharges
amounted to substantial amounts for them. They added that they needed
professional help to show that the Tax Authority’s audit report and
decisions were flawed.

On 18 October 2005 the Administrative Court of
Appeal upheld the lower court’s decisions in full.

The applicants lodged a further appeal to the
Supreme Administrative Court (Regeringsrätten), which, on 5 April 2006, refused them leave
to appeal.

The tax proceedings are still pending before
the national courts.

B. Relevant domestic law and practice

The relevant rules concerning legal aid in Sweden
are to be found in the Legal Aid Act (Rättshjälpslagen, 1996:1619 – hereinafter “the Act”).
Section 7, paragraph 1, of the Act provides that legal aid may be granted
if the person applying for it is in need of legal assistance and cannot
obtain it by other means. Moreover, pursuant to section 8 of the Act,
legal aid may only be granted if it is reasonable for the State to contribute
to the costs, having regard to the nature and importance of the matter,
the value of the contentious issue and other relevant circumstances.
In any event, in matters concerning taxes and various fees for taxes,
legal aid may be granted only when there are special reasons (section
11, paragraph 1, point 3).

Furthermore, section 13, paragraph 1, of the
Act stipulates that legal aid may not be granted to a person who is,
or has been, a businessman where the contentious issue has arisen in
connection with the business, unless there are special reasons relating
to the nature and limited scope of the business, his or her financial
and personal situation and other relevant circumstances. The Act defines
a businessman as a natural person who runs a business of an economic
nature that can be described as professional, or who has a deciding
influence over a legal entity which runs such a business (section 13,
paragraph 2).

From the case-law of the national courts, it
appears that when a case involves tax surcharges, Article 6 § 3(c)
of the Convention is applicable, but that consideration must be given
to the amount of the imposed tax surcharges as well as to the nature
and character of the case. Moreover, only if there is a risk of particularly
serious consequences or if complicated legal questions arise should
free legal assistance be granted on the basis of the Convention in cases
involving tax surcharges (Regeringsrättens Årsbok 2003 ref 56).

Section 8 of the Administrative Court Procedure
Act (Förvaltningsprocesslagen
1971:291) requires the administrative courts to ensure that the circumstances
of each case are clarified to the extent that its character demands.
Where necessary, the courts must give directions for the case-file to
be supplemented with the requisite information.

COMPLAINT

The applicants complained that their right to
free legal assistance under Article 6 § 3(c) of the Convention had
been violated since they had been refused legal aid despite needing
it.

THE LAW

The applicants claimed that the national courts
had violated their right to free legal assistance by refusing their
request for legal aid. Article 6 § 3(c) of the Convention reads as follows:

“Everyone charged with a criminal offence has
the following minimum rights:

c. to defend himself in person or through legal
assistance of his own choosing or, if he has not sufficient means to
pay for legal assistance, to be given it free when the interests of
justice so require.”

The applicants alleged that since their tax cases
involved tax surcharges of rather significant amounts for them, Article
6 of the Convention was applicable under its criminal head. They noted
that they did not have sufficient means to pay for legal assistance
themselves and that this had not been questioned by the national courts.
Moreover, they were both of foreign origin, Mr Barsom having arrived
in Sweden in 1978 and Mr Varli in 1975, and so did not have the necessary
knowledge of Swedish law and language to defend themselves effectively.
They further stated that their tax cases concerned the issues of whether
their restaurant had failed to record all its sales and, if so, the
amounts involved. In their view, this raised complex evidentiary questions.

The Court reiterates that it has found in several
judgments concerning Sweden that the imposition of tax surcharges involves
the determination of a “criminal charge” within the meaning of Article
6 of the Convention, although such surcharges cannot be said to belong
to criminal law under the Swedish legal system (see, in particular, Janosevic v.
Sweden, no. 34619/97, §§ 64 -71, ECHR 2002-VII, and Västberga Taxi Aktiebolag and Vulic v. Sweden, no. 36985/97,
§§ 75-82, 23 July 2002). It follows that Article 6 is applicable under
its criminal head and the question arises whether Article 6 § 3(c)
was complied with.

The Court first observes that, although not absolute,
the right of everyone charged with a criminal offence to be effectively
defended by a lawyer assigned officially if need be, is one of the fundamental
features of a fair trial (see, Poitrimol v. France, judgment of 23 November 1993, § 34, Series A
no. 277-A). However, the right to free legal assistance under Article
6 § 3(c) of the Convention is subject to two conditions. Firstly, the
applicant must lack sufficient means to pay for legal assistance. Secondly,
the “interests of justice” must require that legal aid be granted.

As concerns the first condition, the Court notes
that the applicants have stated that they did not have sufficient means
to pay for a lawyer to represent them since they had been obliged to
pay the additional taxes and tax surcharges imposed on them. However,
the Court does not find it necessary to decide that issue since, in
any event, the second condition is not fulfilled for the reasons set
out below.

With respect to the second condition, the Court
has to take into consideration several factors to determine whether
the interests of justice required the applicants to be granted legal
aid before the domestic courts. This is to be judged by reference to
the facts of the case as a whole having regard, inter alia, to the seriousness of the offence, the severity
of the possible sentence, the complexity of the case and the personal
situation of the accused (see, Quaranta v. Switzerland, judgment of 24 May 1991, §§ 32-36,
Series A no. 205).

As to the seriousness of the offence and the
severity of the possible sentence, the Court observes that the applicants’
cases before the national courts mainly concerned their tax assessments
for 2002 and 2003 and that the only question to fall within the criminal
sphere of Article 6 of the Convention was whether or not to impose tax
surcharges on them. Although the tax surcharges amounted to around EUR
11,500 for Mr Barsom and around EUR 15,600 for Mr Varli, they were able
to pay these sums to the Tax Authority. In this respect, the Court wishes
to point out that, according to Swedish law, any failure by the applicants
to pay the tax surcharges could not have been converted into a prison
sentence. Consequently, they never faced a risk of being deprived of
their liberty (cf. Benham v. the United Kingdom, judgment of 10 June 1996, Reports of Judgments
and Decisions 1996-III, § 61, and Padalov v. Bulgaria, no. 54784/00, § 43, 10 August 2006).

As regards the complexity of the case, the Court
reiterates that it mainly concerned the applicants’ tax assessments.
It further has regard to the fact that their cases were very closely
connected to each other as well as to that of their restaurant and that
all three appellants were represented by the same lawyer before the
Tax Authority and in their appeals to the County Administrative Court.
Moreover, the contentious issues before the national courts primarily
concerned the assessment of the evidence, and, in particular, the question
whether the restaurant had failed to record all its sales or not. The
Court cannot find that any complex legal questions were to be argued
in the cases. Furthermore, the assessment relating to the tax surcharges
was relatively straightforward in that the issue to be determined was
firstly whether or not the applicants had submitted incorrect or incomplete
information in their tax returns to the Tax Authority and, if so, whether
there were any grounds for remission.

Here, the Court has to take into account the
personal situation of the applicants. It notes that both of them have
been living in Sweden for almost 30 years and are businessmen who own
and are in charge of the daily running of a restaurant. In these circumstances,
the Court finds it highly unlikely that they would not be able to present
their case and arguments adequately, without legal assistance, before
the national court.

However, even if the applicants might have had
certain difficulties, the Court stresses that the Swedish administrative
courts have an obligation under the Administrative Court Procedure Act
to ensure that the circumstances of each case are clarified to the extent
that its character demands and, where necessary, to give directions
to the parties to supplement the case-file with the requisite information.

In this context, the Court also notes that the
County Administrative Court, before rejecting the request for legal
aid, specifically assessed the matter with reference both to domestic
law and to Article 6 § 3(c) the Convention.

In view of all of the above, the Court finds
that there is no indication that legal aid was indispensable to give
the applicants effective access to court or that the refusal of legal
aid adversely affected their ability to present their case properly
and satisfactorily (see, Airey v. Ireland, 9 October 1979, §§ 24 and 26, Series A
no. 32, and Gnahoré v. France, no. 40031/98, §§ 39-41, ECHR 2000-IX).
Consequently, in the present case, the interests of justice did not
require the applicants to be granted free legal assistance and the fact
that legal aid was refused by the domestic courts was therefore not
a violation of their rights under Article 6 § 3(c) of the Convention.

It follows that the applications are manifestly
ill-founded within the meaning of Article 35 § 3 of the Convention
and must be rejected pursuant to Article 35 § 4 of the Convention.